Securities and Exchange Commission v. Blazer, No. 1:2016cv03384 - Document 10 (S.D.N.Y. 2020)
Court Description: AMENDED FINAL JUDGMENT AS TO DEFENDANT LOUIS MARTIN BLAZER III amending 7 Judgment. IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is liable for disgorgement in the amount of $1,558,647.00, plus prejudgment interest the reon in the amount of $220,051.57, representing profits gained as a result of the conduct alleged in the Complaint and prejudgment interest through the date of the Defendant's Partial Final Consent Judgment in this matter, provided, however , that Defendant's obligation to pay disgorgement is deemed satisfied by the order of restitution of $1,558,647.00 entered against Defendant in the Criminal Proceeding. In light of the factors present in this case, including the defendant&# 039;s financial condition, the Defendant is additionally liable for a civil penalty of $150,000.00. Defendant shall satisfy these obligations by paying $370,051.57 to the Commission within thirty (30) days after entry of this Amended Final Judgment. (As further set forth herein.) (Signed by Judge J. Paul Oetken on 10/14/2020) (nb)
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Securities and Exchange Commission v. Blazer Doc. 1 Dockets.Justia.com UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK SECURITIES AND EXCHANGE COMMISSION, Plaintiff, Case No. 1:16-CV-3384 (JPO) v. LOUIS MARTIN BLAZER III, Defendant. AMENDED FINAL JUDGMENT AS TO DEFENDANT LOUIS MARTIN BLAZER III WHEREAS, on May 6, 2016, the Securities and Exchange Commission filed a Complaint (the “Complaint”) and defendant Louis M. Blazer III (“Blazer” or “Defendant”) later entered a general appearance; consented to the Court’s jurisdiction over Defendant and the subject matter of this action; consented to the entry of a May 18, 2016, Partial Final Consent Judgment; and consented to the entry of an August 4, 2017, Final Consent Judgment without admitting or denying the allegations of the Complaint (except as to jurisdiction and except as otherwise provided therein in paragraph V); waived findings of fact and conclusions of law; waived service of the Summons and Complaint; and waived any right to appeal from the Final Consent Judgment; WHEREAS on or about September 15, 2017, Blazer pleaded guilty to a five-count Information in connection with United States v. Blazer, 17 Cr. 563 (ER) (S.D.N.Y.), a related criminal proceeding (the “Criminal Proceeding”); on February 2, 2020, the Honorable Edgardo Ramos entered an order of judgment against Blazer; on February 6, 2020, Blazer was sentenced; and on April 30, 2020, Blazer was ordered to pay restitution in the total amount of $1,558,647; WHEREAS the Commission and Blazer consent to this Amended Final Judgment, which deems satisfied Blazer’s obligation to pay disgorgement of $1,558,647.00 under the Final Consent Judgment based on the entry of the restitution order in the Criminal Proceeding; THEREFORE, the Court enters this Amended Final Judgment as follows: I. IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant is permanently restrained and enjoined from violating, directly or indirectly, singly or in concert, Section 17(a) of the Securities Act of 1933 [15 U.S.C. § 77q(a)] by using any means or instruments of transportation or communication in interstate commerce or the mails, in the offer or sale of any security: (a) to employ any device, scheme, or artifice to defraud; (b) to obtain money or property by means of any untrue statement of a material fact or any omission of a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or (c) to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser. II. IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is permanently restrained and enjoined from violating, directly or indirectly, singly or in concert, Section 10(b) of the Securities Exchange Act of 1934 [15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5], by using any means or instrumentality of interstate commerce, or of the mails, or of any facility of any national securities exchange, in connection with the purchase or sale of any security: (a) to employ any device, scheme, or artifice to defraud; (b) to make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances 2 under which they were made, not misleading; or (c) to engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person. III. IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is permanently restrained and enjoined from violating, directly or indirectly, singly or in concert, Sections 206(1) and 206(2) of the Investment Advisers Act of 1940 (“Investment Advisers Act”) [15 U.S.C. §§ 80b-6(1) and 80b-6(2)] by knowingly or recklessly while acting as an investment adviser within the meaning of Section 202(a)(11) of the Investment Advisers Act [15 U.S.C. § 80b-2(a)(11)], employing any device, scheme, and/or artifice to defraud any client or prospective client and/or engage in acts, practices, or courses of business which operate as a fraud or deceit upon any client or prospective client. IV. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided in Federal Rule of Civil Procedure 65(d)(2), paragraphs I, II, and III above also bind the following who receive actual notice of this Amended Final Judgment by personal service or otherwise: (a) Defendant’s agents, servants, employees, and attorneys; and (b) other persons in active concert or participation with Defendant or with anyone described in (a). 3 V. IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is liable for disgorgement in the amount of $1,558,647.00, plus prejudgment interest thereon in the amount of $220,051.57, representing profits gained as a result of the conduct alleged in the Complaint and prejudgment interest through the date of the Defendant’s Partial Final Consent Judgment in this matter, provided, however, that Defendant’s obligation to pay disgorgement is deemed satisfied by the order of restitution of $1,558,647.00 entered against Defendant in the Criminal Proceeding. In light of the factors present in this case, including the defendant’s financial condition, the Defendant is additionally liable for a civil penalty of $150,000.00. Defendant shall satisfy these obligations by paying $370,051.57 to the Commission within thirty (30) days after entry of this Amended Final Judgment. Defendant may transmit payment electronically to the Commission, which will provide detailed ACH transfer/Fedwire instructions upon request. Payment may also be made directly from a bank account via Pay.gov through the SEC website at http://www.sec.gov/about/offices/ofm.htm. Defendant may also pay by certified check, bank cashier’s check, or United States postal money order payable to the Securities and Exchange Commission, which shall be delivered or mailed to Enterprise Services Center Accounts Receivable Branch 6500 South MacArthur Boulevard Oklahoma City, OK 73169 and shall be accompanied by a letter identifying the case title, civil action number, and name of this Court; Louis Martin Blazer III as a defendant in this action; and specifying that payment is made pursuant to this Amended Final Judgment. Defendant shall simultaneously transmit photocopies of evidence of payment and case 4 identifying information to the Commission’s counsel in this action. By making this payment, Defendant relinquishes all legal and equitable right, title, and interest in such funds and no part of the funds shall be returned to Defendant. The Commission may enforce the Court’s judgment through the remedies authorized by law at any time after 30 days following the entry of this Amended Final Judgment. Defendant shall pay post-judgment interest on any delinquent amounts pursuant to 28 U.S.C. § 1961. The Commission shall hold the funds, together with any interest and income earned thereon (collectively, the “Fund”), and may propose a plan to distribute the Fund subject to the Court’s approval. Such a plan may provide that the Fund shall be distributed pursuant to the Fair Fund provisions of Section 308(a) of the Sarbanes-Oxley Act of 2002. The Court shall retain jurisdiction over the administration of any distribution of the Fund. If the Commission staff determines that the Fund will not be distributed, the Commission shall send the funds paid pursuant to this Amended Final Judgment to the United States Treasury. Regardless of whether any such Fair Fund distribution is made, amounts ordered to be paid as civil penalties pursuant to this Amended Final Judgment shall be treated as penalties paid to the government for all purposes, including all tax purposes. To preserve the deterrent effect of the civil penalty, Defendant shall not, after offset or reduction of any award of compensatory damages in any Related Investor Action based on Defendant’s payment of disgorgement in this action, argue that he is entitled to, nor shall he further benefit by, offset or reduction of such compensatory damages award by the amount of any part of Defendant’s payment of a civil penalty in this action (“Penalty Offset”). If the court in any Related Investor Action grants such a Penalty Offset, Defendant shall, within 30 days after entry of a final order granting the Penalty Offset, notify the Commission’s counsel in this action and pay the amount of the Penalty Offset to the United States Treasury or to a 5 Fair Fund, as the Commission directs. Such a payment shall not be deemed an additional civil penalty and shall not be deemed to change the amount of the civil penalty imposed in this Amended Final Judgment. For purposes of this paragraph, a “Related Investor Action” means a private damages action brought against Defendant by or on behalf of one or more investors based on substantially the same facts as alleged in the Complaint in this action. VI. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent is incorporated herein with the same force and effect as if fully set forth herein, and that Defendant shall comply with all of the undertakings and agreements set forth therein. VII. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, solely for purposes of exceptions to discharge set forth in Section 523 of the Bankruptcy Code [11 U.S.C. § 523], the allegations in the complaint are true and admitted by Defendant, and further, any debt for disgorgement, prejudgment interest, civil penalty or other amounts due by Defendant under this Amended Final Judgment or any other judgment, order, consent order, decree or settlement agreement entered in connection with this proceeding, is a debt for the violation by Defendant of the federal securities laws or any regulation or order issued under such laws, as set forth in Section 523(a)(19) of the Bankruptcy Code [11 U.S.C. § 523(a)(19)]. 6 VIII. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain jurisdiction of this matter for the purposes of enforcing the terms of this Amended Final Judgment. Dated: October 14, 2020 ____________________________________ UNITED STATES DISTRICT JUDGE 7
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